KUALA LUMPUR (Aug 17): DRB-Hicom Bhd booked a net loss of RM217.5 million or 11.25 sen per share in the second quarter ended June 30, 2021 (2QFY21).

The diversified conglomerate's automotive and services divisions fell into the red, coupled with impairment of RM46.71 million in the quarter under review, as it contended with the multiple forms of Movement Control Order (MCO) in May and June 2021, it said in its filing today.

Nonetheless, the latest quarterly net loss showed improvements compared with a year ago, when DRB-Hicom booked a net loss of RM306.08 million or 15.83 sen per share, also due to the first MCO in April and May 2020, as well as a higher impairment of RM54.61 million.

Quarterly revenue rose 30.8% year-on-year to RM2.62 billion, from RM2 billion, led by higher automotive revenue contribution although services and properties contribution lagged.

For the six-month period ended June 30, 2021 (1HFY21), DRB-Hicom's cumulative net loss more than halved to RM234.46 million or 12.13 sen per share, compared with RM479.36 million or 24.8 sen in 1HFY20.

Half-year revenue expanded 29.4% to RM6.13 billion, from RM4.74 billion — again as the automotive sector contribution grew in contrast to services and properties segments' contribution.

On prospects, DRB-Hicom said the prolonged MCO is expected to impact the full-year sales as showrooms remain closed in some states despite the recent reopening of 11 economic sectors.

"Even as the Hicom Automotive Complex in Pekan, Pahang obtained permission to operate as the east coast state moved into Phase 2 of the National Recovery Plan, vendors and suppliers based in the Klang Valley were closed, halting component supply," it said.

"The automotive sector remains the backbone of DRB-Hicom's businesses.

"With the implementation of the Full MCO that halted vehicle sales, Proton and other marques within the group will focus on re-strategising its sales plan," said DRB-Hicom, adding that the extension of passenger vehicle sales tax exemption until end-2021 may further support demand.

"DRB-Hicom's other businesses in the defence, aerospace, banking, services and properties segments will continue to focus on prudent cash management to stay afloat amidst the challenging business landscape arising from the pandemic.

"Based on the aforementioned, the group remains cautious of its financial performance for the year ending Dec 31, 2021 given the heightened uncertainties over the full economic impact of the prolonged Covid pandemic," it said.

Shares of DRB-Hicom rose three sen or 1.89% to RM1.62, valuing the group at RM3.13 billion.